State employee union members, employees and supporters march past the State House on Monday as they protest day three of a state shutdown in Augusta. Photo by Elise Klysa

AUGUSTA — State budget negotiators worked into the night Saturday trying to end a government shutdown that sidelined thousands of state employees and inflamed political tensions between lawmakers and Maine’s governor.

Nearly 24 hours after House Republicans blocked a $7.1 billion budget compromise, caucus leaders offered the latest in a series of changes aimed at winning the signature of Republican Gov. Paul LePage and reopening government offices before Monday.

Maine state employees union members march past the State House on Saturday, protesting the shutdown that went into effect at 12:01 a.m. Staff photo by Shawn Patrick Ouellette

AUGUSTA, ME - JULY 1: House Majority Leader Erin Herbig and House Assistant Majority Leader Jared Golden, left, are met by applause at the State House by dozens of state workers on Saturday, July 1, 2017, the first day of Maine's government shutdown following a a budget impasse that has yet to be resolved. (Staff photo by Derek Davis/Staff Photographer)

Speaker of the House Sara Gideon, D-Freeport: Staff photo by Derek Davis

But nearly all of the proposals were repeats of budget items or policy changes previously considered and rejected by the Legislature. And several members of the budget conference committee reacted coolly to the latest list from a House Republican caucus that blocked passage of the compromise effort late Friday and has essentially served as LePage’s proxy for months during budget negotiations.

“Why are we having this conversation on July 1? This is obscene that we are in a shutdown because one caucus in this building just keeps piling on demands with complete disregard to the well-established process,” Sen. Cathy Breen, D-Falmouth, said during a feisty exchange with House Minority Leader Rep. Kenneth Fredette, R-Newport. “I see no reason why I should entertain any of these when another list could show up at midnight tonight. And I don’t know who I am negotiating with. Is it you, Mr. Fredette, or is it the chief executive?”

Most state government functions ceased as of 12:01 a.m. Saturday after lawmakers could not agree on a spending plan before the new fiscal year began. A $7.1 billion budget compromise failed to win the two-thirds majority needed for passage late Friday after 60 House Republicans voted against a measure that had unanimous support among Democrats in both chambers and won votes from 17 of 18 Senate Republicans.

After hearing a presentation by Fredette, budget negotiators wrapped up Saturday night and plan to reconvene at 10:30 a.m. Sunday. That means state government will likely remain closed through at least Sunday – but potentially much longer – as leaders try to win two-thirds support in both chambers and then send the bill to Maine’s unpredictable governor.

As with the budget compromise that failed Friday night, the House Republican offer would repeal the 3 percent tax surcharge on earnings over $200,000 while injecting an additional $162 million into public schools. But the caucus’ offer would also eliminate the proposed 1.5 percent increase in Maine’s lodging tax, allow for a statewide teacher contract pilot project, and seek major changes aimed at ending tax exemptions for land trusts and some properties in Maine’s “tree growth” forestry program.

The statewide teacher contract – a major educational “reform” sought by LePage – has already been rejected by the Legislature and is likely to face strong opposition from Democrats and the teachers union. Also, a proposal to eliminate $4.5 million for Maine’s community colleges will likely be controversial.

Fredette faced repeated questions about who was offering the proposal – House Republicans or LePage?

“This is a proposal from the House Republicans … that will get us to yes, that will get us the votes from the Republican caucus in the House and the signature of the governor,” Fredette said.

‘HE NEEDS TO … LOOK STATE WORKERS IN THE EYE’

Late Friday night after the budget compromise failed on an 87-60 vote in the House, LePage threw an unexpected curve ball by trying to submit a new budget bill with just hours left before a shutdown and presenting legislative leaders with a list of what they described as “demands.”

On Saturday, Democratic House Speaker Sara Gideon of Freeport formally invited LePage to present his proposals to the six-member budget conference committee. But LePage declined, saying, “It’s not my budget, it’s the House Republicans,” according to Gideon.

“He needs to walk the 100 yards across the street and come into this building, look state workers in the eye at the same time and do his job,” Gideon said.

LePage’s office released a statement Saturday afternoon that the governor no longer planned to offer a separate bill because of logistical challenges of printing the document.

“Governor LePage now understands that House Republicans will offer amendments to the existing budget bill to advance changes that will enable a two-thirds vote on a fiscally responsible budget, with the goal to reopen state government before most state workers return to work next week,” LePage spokesman Peter Steele said in a statement. “The Governor looks forward to reviewing that proposal in the hopes it will provide a solution to this shutdown.”

Tensions remain high at the State House.

Democrats contend that they have made major concessions in the budget, most notably repealing the controversial 3 percent tax surcharge on earnings above $200,000. That tax surcharge was expected to generate $320 million over the biennium for K-12 education, although the budget compromise still on the table replaced roughly half of that sum – $162 million – with investments in education from other sources.

While the compromise garnered support from 19 of 20 Senate Republicans, LePage and House Republicans oppose a lodging tax increase from 9 percent to 10.5 percent. LePage has also vowed to wait the full 10 days allowed to him under the law to take action on any budget bill that contains a lodging tax increase without income tax cuts.

House Republican leaders were quiet Saturday morning as closed-door meetings continued. There was palpable anger among Democratic lawmakers, however, over the failure of the budget and resulting shutdown.

“I think they are upset,” said Rep. Martin Grohman, D-Biddeford. “I think we (Democrats) came a long way to an agreement and we may not see that again.”

Some Democrats were even suggesting that they revisit the issue of repealing the 3 percent tax surcharge after the compromise’s failure.

“I think it’s a possibility that it could come back on the table,” Grohman said.

WORKERS WILL NOT BE PAID

The shutdown is affecting thousands of state workers, who will not be paid while government is closed. But Maine state parks were still open and staffed during the holiday weekend, and law enforcement, prison guards, child welfare workers and other employees who provide “emergency services” remain on the job.

Saturday morning, more than 150 state workers and their supporters marched around the State House and the Blaine House demanding an end to the hours-old shutdown. Afterward, the hallways of the State House were filled with purple-shirted members of the Maine State Employees Association who cheered Democratic lawmakers and jeered Republican House members who opposed the budget compromise. Chants of “Do your job!” and “Let us work!” filled the third floor as workers gathered outside the room where House Republicans were meeting. Those lawmakers then had to walk through a gantlet of chanting workers as they made their way to the House chamber.

Saturday’s event, though lively, followed rather tense moments late Friday between legislative leaders and LePage.

Gideon said that during a late-night meeting at the Blaine House, LePage threw a “temper tantrum” after Democrats made clear they would not agree to all of the demands and told those present to “Shut her down.” Gideon also said LePage demonstrated “aggressive behavior,” prompting her to leave the meeting.

She declined to elaborate on the “aggressive behavior” Saturday but said “the governor’s behavior last night was unproductive and showed me that he wasn’t serious.”

Earlier Saturday, LePage’s office said the governor “made every attempt to compromise with Democrats and he will continue to do so.”

“We did not want Speaker Gideon to walk away from the table late last night and today hope she is willing to work toward a solution,” LePage spokeswoman Adrienne Bennett said in a statement. “The governor and leadership understand the gravity of the situation of a shutdown and the adverse impact it has had already. However, our Governor will not raise taxes and will continue advocating for education reform to ensure more money goes to teachers and directly into the classroom.”

It was unclear Saturday how long the shutdown would last. The last shutdown in 1991 lasted for 16 days.

Among the state workers rallying in the Capitol on Saturday was Jonathan O’Donnell with his pregnant wife, Jaclyn, and their two young children. An employee in the Maine Center for Disease Control and Prevention’s childhood lead poisoning prevention program, O’Donnell said no one in his division is working during the shutdown because they were not deemed essential or emergency personnel.

“The governor seems to have an open disdain for state workers,” O’Donnell said. “There was no information that came down and nobody knew if they were going to be ‘essential’ or not until the end of the day on Friday.”

The couple acknowledged that they make decent money but said that doesn’t mean they have the savings to pay all of their bills on a single salary, especially if they have to pick up more of her health costs during a shutdown. Jaclyn O’Donnell, whose baby is due in just six weeks, said she had hoped to switch to part-time work in her nursing job starting this month but was, instead, picking up overtime shifts.

“We cannot make our mortgage payments and utilities bills on my pay alone, and then have to pay insurance premiums on top of that,” Jaclyn O’Donnell said.

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